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AI That Heals the Bottom Line — Cost-Saving Strategies for Health Care Leaders

By Tom Hughes

Health care providers have embraced AI with enthusiasm, recognizing its potential to automate manual tasks, enhance accuracy, and improve patient outcomes. This year, those early ambitions are evolving into practical, targeted applications. Providers are strategically pinpointing challenges and identifying opportunities to embed AI solutions directly into workflows and processes—and reshaping financial performance. It marks a pivotal phase in the AI transformation, one that will pave the way for broader, scalable adoption across the health care sector.

As enthusiasm for AI continues to build, health care providers face ongoing challenges in scaling adoption and securing the necessary investment. Identifying the right tools to pilot, developing a sustainable budget, expanding programs, and evaluating operational impacts can be complex and overwhelming. While AI offers tremendous potential to streamline administrative processes and strengthen financial performance, implementation often brings its own set of challenges. Through strategic planning and deliberate execution, however, providers can successfully navigate these complexities and realize the full value of their AI investments.

Improving Financial Performance
When applied strategically, the efficiencies gained from AI can translate into substantial savings for health care providers. In back-office management, the numbers can be staggering. AI has been shown to dramatically improve the claims process, for example, reducing denials and delays. According to a report from KLAS, claims, adjudications, and appeals cost health care systems $20 billion annually. Ultimately, more than half of denials are overturned, which the report notes “equates to unnecessary and unstable administrative waste for both payer and provider organizations.” Applying AI to the claims process could improve claims accuracy by 3% to 5%, according to a study by McKinsey, reducing health care systems’ costs considerably. One insurer saved $82 million annually by integrating AI into the claims process.

The claims department is only one vertical to see significant improvement. The same report from McKinsey found that AI can improve sales conversion rates by 10% to 20%, drive premium growth by 10% to 15%, and reduce new patient onboarding costs by 20% to 40%. AI offers powerful cost-saving potential across the health care value chain. To unlock those benefits, providers must align AI solutions with real business needs and practical challenges.

Practical AI Tools
AI has the potential to provide measurable value to a health care system. Through automation and data processing, it can help attract and retain talent, reduce employee burnout, and improve the patient experience. AI isn’t a single, overarching software program, though. Rather, there are a network of AI-powered tools that have everyday applications.

Already, a handful of tools are becoming standardized in the health care industry. In the clinic environment, health care providers are investing in AI-powered scribe tools to take notes during a patient visit that are input into the EMR. This dramatically improves patient engagement because the doctor can be present during the visit rather than taking notes themselves. A report from Peterson Health Technology Institute found that scribe tools significantly reduced clinic burnout and cognitive load by 40% to 63% in reporting health care systems. Diagnostic imaging is another common area of AI adoption. AI can process radiology imaging and identify abnormalities to drive early detection and treatment.

To choose the right tool and create the right network of AI systems to gain the full power of automation, health care providers need to identify a specific problem in current processes and the desired outcome. Then, the provider can choose the right AI solution for the clinic, the best implementation approach—such as a pilot program—and a plan to scale the program and seamlessly transition from the traditional process.

Managing Risk
AI tools have the potential to deliver significant benefits, but health care providers must also manage the heightened risks that come with adoption. Data security remains a top priority. Providers must safeguard patient information, uphold medical ethics, and ensure full regulatory compliance. Partnering with reputable technology firms and maintaining robust, firewall-protected networks are essential steps to protect sensitive data and preserve patient trust.

The cost of implementation and strategy to scale with minimal disruption are also primary concerns for health care providers. Financial and banking advisors will play an important role here in navigating health care clients through a significant tech investment and creating a financial plan to support the longevity of the program. It may come as a surprise, but a call to the bank is among the first calls a health care provider should make when pursuing an AI initiative.

Health care providers typically have the option to lease the technology—a great short-term solution for a pilot program—or finance the entire technology outright. This is an important conversation to understand the organization’s ability to leverage AI.

AI adoption is ramping up quickly. According to a 2024 McKinsey survey, 89% of health care organizations have either already implemented or are in the process of implementing AI. Health care providers are eager to embrace AI tools, but concerns persist around implementation costs and potential risks. A strategic, problem-solving approach—paired with close collaboration between operational and financial teams to clarify cost structures—is essential for a successful AI rollout.

— Tom Hughes is a senior relationship manager for commercial health care at KeyBank and is a certified treasury professional accredited by the Association for Financial Professionals.

Disclosure: This article is for general information purposes only and does not consider the specific investment objectives, financial situation, and particular needs of any individual person or entity. Banking products and services are offered by KeyBank National Association. All credit, loan, and leasing products are subject to collateral and/or credit approval terms, conditions, and availability and subject to change.